California’s poor kept in poverty by job-killing elite: John Husing

There was a time when California made it a priority to create jobs that would allow its most vulnerable residents to move up skill ladders into the middle class. No longer. Today, the Golden State is quietly seeing millions fall into poverty while their plight is met with a deafening silence from Sacramento. Worse, today’s state leaders seem proudest of policies that are compounding this human tragedy.

A careful look at the recently released 2012 American Community Survey underscores the degree to which California’s enormous increase in poverty is an issue of geography, class and race. It also helps explain why today’s generation of Democratic leaders have virtually ignored this situation.

Geography is a key because one in every five people living in counties along the state’s central spine from San Joaquin County to the Mexican border plus Los Angeles are living below the federal poverty level (family of four: $23,550). In these 12 counties, 3.7 million people are poor including 29 percent of the area’s children. It is no surprise that 21 percent of residents have no health insurance.

Class is an issue because California is increasingly being divided between a well-educated elite who control the state and a huge marginally educated underclass that has remained largely invisible to them. The governing class tends to live in coastal counties, the Bay Area and Sacramento. Again, numbers tell the story. While 43.5 percent of the adults who live in the nine Bay Area counties have a bachelor’s or higher degree, 5.4 million of the 11.7 million people (46 percent) living in the state’s interior or L.A. County either stopped their educations with a high school diploma or did not get that far.

There is an ethnic dimension to this issue since 26 percent of Hispanics and 27 percent of African Americans in the 12 poorer counties are living below the federal poverty level, 2.7 million people. Educational levels impact them as 67 percent of Hispanics and 36 percent of African Americans are marginally educated, 3.6 million adults. For parents in these groups, it is difficult to find work that can lead to middle class incomes in today’s economy.

If California had appropriate policies for dealing with the poverty facing this huge portion of the state’s population, two efforts would be in evidence. First, an immediate goal would be to encourage sectors with few barriers to entry and with skill ladders up which marginally educated residents could move toward middle class incomes. Second, the state would be engaged in the equivalent of the GI Bill with short-course programs aimed at giving these adults the tools they need to move up these skill ladders. That is vital since the nature of the work in most sectors is becoming increasingly technical.

Do we see this? No. On the training front, California is pumping money into the community college system that, with a few notable exceptions, has proven incapable of handling this aspect of the state’s educational problem. The system remains dominated by academics who see their role as the first two years of a four-year education. They accept some emphasis on one-year certificate programs. The system is largely a failure at providing the rapid, short-course training needed by marginally educated adults and the companies that could hire or promote them.

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Meanwhile, California’s governing elite is far more interested in environmental purity than encouraging the blue-collar sectors that could provide upwardly mobile jobs to this struggling base of its population. Thus, the U.S. added nearly 510,000 manufacturing jobs from January 2010 to June 2013, while California’s over-regulated producers added just 7,800. While construction remains in the doldrums, the California Legislature, under pressure from environmentalists, refused to seriously amend the California Environmental Quality Act. This despite evidence that it has increasingly become a tool of NIMBYs and lawyers wishing to frustrate even socially desirable projects.

In the Central Valley, the Monterey Shale offers the potential of an employment bonanza for workers needing access to entry-level jobs in the high-paying energy sector. Not surprisingly, the state’s powerful green lobby is striving to deny them that opportunity. In Southern California, international trade has become a major source of upwardly mobile job growth, yet the South Coast Air Quality Management District has repeatedly sent its staff members to testify against the building of facilities needed for the sector’s expansion.

Public health has been the rallying cry of those who have created this job-killing regulatory climate. However, their mantra is fundamentally flawed. Like it or not, public health research groups like the Robert Woods Johnson Foundation find that socioeconomic difficulties, not environmental issues, are the principal causes of public health risks. In areas where large numbers of people are poor, marginally educated, unemployed or underemployed, researchers find life expectancies are shortened. In effect, by cutting off job growth in the very sectors that can allow the state’s most vulnerable people to move out of poverty, California’s privileged classes are ensuring that they remain subjected to serious health risks.

Unless California’s leaders, in particular given their majorities, those in Democratic Party, begin to understand the pain that their policies are inflicting on a huge share of the state’s population, we are destined to live with a growing and permanent underclass with all of the public health risks that this is creating.

John Husing is chief economist of the Inland Empire Economic Partnership.